India’s cotton crop to remain stagnant

Indian cotton crop for the next season beginning in October will remain at the same level as the current year. Mumbai-based Cotton Association of India (CAI) released the first estimate for the next year’s cotton crop beginning on October 1. For the 2016-17 (October to September) new season, India is estimated to produce 33.6 million bales (170 kg each). CAI has estimated current year’s crop production to be 33.8 million bales, which tallies with the recent estimate by Indian government’s cotton advisory board.

However, there will be acreage reduction of about 10 per cent next year, which will be offset by increase in productivity, according to CAI. Interestingly, next year’s domestic consumption is expected to remain at same level of about 30.8 million bales. CAI estimates, imports next year will rise slightly and the total import is estimated to be about 2 million bales as against 1.5 million bales, this year.

Ramkumar’s telephone conversation with a cotton analyst from India revealed that India might import more than what is reported if China reverts back to improving its inventory during next season or if the weather situation is not favourable. With China starting to import, if India has to maintain its current export level or enhance it, certainly its stocks will be lowered. These situations may lead to a tight supply situation during the second half of the new cotton season, according to the analyst.